Specifically, the GST rate on shoes priced up to Rs 2,500 per pair was slashed from 12% to 5%. This move is expected to boost demand by making footwear more affordable for consumers, which in turn fueled investor optimism and lifted stock prices across the sector.
Following the announcement, several footwear stocks saw significant gains by 9:50 am. Campus Activewear led the rally, jumping 7.30% to Rs 288.20. Liberty Shoes also saw a rise of 3%, reaching Rs 348.40. Relaxo Footwears recorded a 2.15% increase, ending at Rs 510.10, while Bata India edged up 1% to Rs 1,173.60.
The new rates will come into effect from September 22.
The tax cut is expected to ease input costs and boost demand in the affordable footwear segment, which primarily caters to price-sensitive consumers in semi-urban and rural markets. Analysts suggest that the rate reduction could improve sales volumes for mid-market and value-oriented brands.
This reform follows Prime Minister Narendra Modi’s Independence Day speech, where he hinted at a “Diwali gift” through a broader GST overhaul. A Group of Ministers reviewed the proposal, which was later approved by the Council during its September 3–4 session.Since the Independence Day speech, stocks such as Relaxo Footwears, Mayur Leather Products, Bata India, and Liberty Shoes have already recorded double-digit gains. The positive momentum is likely driven by investor optimism following key policy signals and reforms hinted at during the address.Bata India, Relaxo Footwears, and Campus Activewear remain the top three companies in the footwear sector based on market capitalization.
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